October ,190 Respondents Online Methodology

Transcription

1 Consumer Confidence Index October ,190 Respondents Online Methodology

2 Objective To understand perceptions and attitudes of Middle Eastern consumers regarding the economy of their countries, their personal financial and job situation, their likelihood to purchase and invest and the employment market in general. Four indices will be extrapolated from these findings on a regular quarterly basis for which the findings of this analysis serve as the third period (October 2007) after the base period in April, 2007 These are the:- Consumer Confidence Index (CCI) Consumer Expectation Index (CEI) Propensity to Consume/Spend Index (PCI) Employee Confidence Index (ECI)

3 Project Background Consumer confidence is a measure of the economic well-being of a country It is a reflection of consumer satisfaction levels and expectations based on various factors in the economy - inflation, stock market performance, job opportunities/salary structures, unemployment, investment avenues/returns, business growth, state economic policies, infrastructure, cost of living, interest rates, exchange rates etc. Such consumer satisfaction levels and expectations will have an effect on economic variables For example, if consumers are positive about the economy and have disposable income levels that are perceived as sufficient, they will tend to spend more on consumer goods This in turn will drive business dependent on consumer spending, thereby creating further economic growth On the other hand, a pessimistic view of the economy would cause consumers to rein in their spending, creating a spending recession which could effectively cause business losses/ economic downturn Similarly, if employable adults are optimistic about job prospects and opportunities, job security, have healthy salary expectations and are hopeful about their career growth and development, it will be reflected in their attitudes towards work and the economy as a whole as well as their spending behaviours Therefore following trends in consumer and employee expectations could help forecast economic variables This information is useful for professionals, manufacturers/business people, recruitment consultants/agencies, economists and the general public

4 Respondent Profile Age and Gender: Adult males and females Aged years Nationalities Local Arab Expats Western Expats Asians Country of Residence GCC: UAE, KSA, Kuwait, Oman*, Qatar, Bahrain* Levant: Lebanon, Syria*, Jordan North Africa: Egypt, Morocco*, Algeria, Tunisia* Subcontinent: Pakistan *low sample for current wave and hence not presented Methodology: Online data collection was done between 18 th October and 12 th November. The total number of respondents achieved was 14,190

5 Calculation of Indices and Benchmarking The indices which concentrate on measuring consumer confidence are the: Consumer Confidence Index (CCI) Consumer Expectation Index (CEI) Propensity to Consume/Spend Index (PCI) The index which aims to measure the confidence that employed and working people have with the job market and their own career prospects is: Employee Confidence Index (ECI) The Consumer Confidence Index is composed of the following five questions: 1. We would like to ask you about your financial position currently. How do you think your (and your family s) current financial position compares with that of last year? a) Better, b) Same as last year, c) Worse, d) Don t know/can t say 2. In what way do you think your (and your family s) financial position would change in a year s time? a) Better, b) Remain the same as this year, c) Worse, d) Don t know/can t say 3. How do you think your current expectations about your country s economy compare with those that you had 3 months previously? a) Better, b) Same, c) Worse, d) Don t know/can t say 4. In what way do you think your country s economy would change in a year s time? a) Better, b) Remain the same as this year, c) Worse, d) Don t know/can t say 5. How would you rate the current period as a time to buy consumer durable goods such as television, refrigerator, computer, furniture or vehicles or property? a) Good time, b) Neutral time, c) Bad time, d) Don t know/can t say

6 Calculation of Indices and Benchmarking The index is calculated according to the following formula: Index Value = (Current period value / Base period value) * 100 Current period s value for each question is calculated as = ((Number of optimistic answers Number of pessimistic answers) / Achieved sample)*100) Current period values for each question are summed up to obtain current period s value for the overall index Current period s value calculated for April 2007 is fixed as the base period value The base period of the index is set as April 2007 and the value of the index at this period is 100 The index has a point of scale ranging from 0 to 200 There are two sub-indexes of CCI: Consumer Expectation Index (CEI) Propensity to Consume/Spend Index (PCI) The CEI is calculated from questions 2 and 4 The PCI is calculated using only the fifth question The methodology for calculating both these sub-indexes is the same as used for calculating CCI Current period s value calculated for April 2007 is fixed as the base period value CCI and its sub-indexes will be calculated separately for each country

7 Calculation of Indices and Benchmarking The Employee Confidence Index is composed of the following five questions: 1. Currently, how easy or difficult would you say it is, to find a new job in the country you live in? a) Plenty of jobs, b) Not many jobs, c) Very few jobs, d) Don t know/can t say 2. In what way do you expect availability of employment to change in a year s time? a) More jobs, b) Same number of jobs, c) Fewer jobs, d) Don t know/can t say 3. How would you rate your satisfaction with your current job and career prospects? a) High, b) Neutral, c) Low, d) Don t know/can t say 4. How would you rate your satisfaction with career growth in your current organisation? a) High, b) Neutral, c) Low, d) Don t know/can t say 5. How would you rate your satisfaction with job security in your current organisation? a) High, b) Neutral, c) Low, d) Don t know/can t say 6. How would you rate your satisfaction with your current compensation (including salary, allowances and other benefits)? a) High, b) Neutral, c) Low, d) Don t know/can t say Current period values for each question will be summed up to obtain current period s value for the overall index Current period s value calculated for April 2007 is fixed as the base period value The base period of the index is set as April 2007 and the value of the index at this period is 100 ECI will be calculated separately for each country

8 Current Period Values for CCI & ECI by Country, April 2007 Base Period Value for Algeria Egypt Kuwait Lebanon Qatar Saudi Arabia Syria UAE Achieved Sample Size CEI PCI CCI ECI

9 Current Period Values for CCI & ECI by Country, July 2007 Values for July 2007 Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Achieved Sample Size CEI PCI CCI ECI

10 Current Period Values for CCI & ECI by Country, October 2007 Values for October 2007 Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Achieved Sample Size CEI PCI CCI ECI

11 Current Period Values for CCI & ECI by Country, of April & October 2007 Algeria Egypt Kuwait Lebanon Qatar Saudi Arabia UAE April Oct April Oct April Oct April Oct April Oct April Oct April Oct Achieved Sample Size CEI PCI CCI ECI

12 Indices by Country, July 2007 Index Algeria Egypt Kuwait Lebanon Qatar Saudi Arabia UAE CEI PCI CCI ECI

13 Indices by Country, October 2007 Index Algeria Egypt Kuwait Lebanon Qatar Saudi Arabia UAE CEI PCI CCI ECI

14 What do the Indices Indicate? Since the base period for the Consumer and Employee Confidence Survey was pegged in April, 2007, all subsequent indices calculations would be comparable to this period An index of > 100 means the confidence for the current period (in this case, October, 2007) is higher than that in April, 2007 Conversely, an index of < 100 indicates a dip in confidence compared to that in April, 2007 Countries which had a period of high confidence during April, 2007 would need to match or exceed those levels of optimism for a better score whereas countries that were pessimistic in April, 2007 probably have a slightly easier task of reducing the negativity or returning to normal circumstances for generating a higher score Though the overall absolute values are lower, the indices for Lebanon are among the highest on all except CEI since the April wave was conducted a relatively short period after the war Most other countries displayed indices lower than 100 Even in the UAE which had a high absolute value in April 2007 a drop in most indices is seen Among the other GCC countries, Kuwait and Qatar also experienced a dip while Saudi Arabia witnessed a significant decline on PCI In comparison, Algeria and Egypt did not suffer a major dip in confidence The scores for CEI were lowest for Saudi Arabia (91.5) and UAE (93.3) Propensity to Consume displayed a more pessimistic attitude with most countries esp. Algeria, Kuwait, Qatar and Saudi Arabia feeling significantly lower confidence On overall Consumer Confidence, Qatar, Saudi and UAE were relatively more despondent at 91.6, 88.9 and 93.4 respectively In terms of Employee Confidence, the same countries of Qatar (93.4), Saudi (93.7) and UAE (95.2) had lower scores than others but these were still slightly better than their Consumer Confidence levels

15 What does this Mean for the UAE? Overall, the current values for UAE are among the lowest in the region and are comparable to the other big GCC economies of Qatar and Saudi Arabia Only on Propensity to Consume, does the UAE generate a score that is higher than most other countries The indices for UAE are remarkably in a much narrower range than other countries the difference between the high and low scores for UAE is less than 2% as compared to a range of nearly 9% in Saudi and 6% in Qatar This points to a possible higher correlation between the indices for the UAE One of the reasons for below par indices could be due to the high standards set during the base period of April, 2007 This means that consumers are not as confident about the country s economy and their own financial situation as they were 6 months back This may partly be due to an increase in inflation as 3% more respondents felt their salary had not kept pace with the rising cost of living Therefore, the UAE economy probably needs a boost in optimism among its residents Probably the festive season and the new year may herald a new confidence

16 How does the Data Compare to April 2007? The data displays remarkable stability and statistical reliability besides pointing to a declining confidence in October This is mainly due to the representativeness of the sample, random selection, sample matching and large sample sizes. It also corroborates the fact that participants have consistently and truthfully answered all questions and, therefore, the figures can be reliably compared to the April and July figures Some of the answers to the questions not used for index calculations have been presented below. They show a high level of correlation Positive answer Total UAE April, 07 July, 07 Oct, 07 April, 07 July, 07 Oct, 07 Business conditions Change in business conditions More employees in organization Salary vs. cost of living Growth in number of employees Keeping up with staffing requirements Impact of inflation on business Impact of real estate cost on business

17 How does the Data Compare to April and July 2007? Positive answer Total UAE April, 07 July, 07 Oct, 07 April, 07 July, 07 Oct, 07 Vehicle in next 12 months Property in next 12 months Plans to invest in next 6 months Desktop/laptop Furniture Digital camera LCD/Plasma TV A/C Refrigerator Washing m/c DVD/VCD These figures indicate a good level of stability between April, July and October Though there is a consistent decline on most other aspects at a regional and country level, there does not seem to be a major shift in people s purchasing sentiments i.e. their durable shopping or major investments list

18 Respondent Profile

19 Respondent profile Country Other Bahrain Nationality Country of residence Base: Total Sample N= Saudi Arabia UAE Egypt Pakistan Jordan Kuwait Algeria Qatar Lebanon Tunisia Syria Oman Morocco

20 Respondent profile - Personal Age Marital status 19% 20 to to 39 48% 40 and Above 33% Base: Total Sample N= Base: Total Sample N= Monthly income Children Base: Total Sample N= Base: Those who are Married N=8069

21 Respondent profile - Organizational Working Time Level at Work Sector Base: Total Sample N= 14190

22 Appraisal of Present Situation 1/3 Q. How do you think your (and family s) current financial position compares with that of last year? Q. How do you think your current expectations about your country s economy compare with those that you had 3 months previously? Q. How would you rate the current period as a time to buy consumer durable goods? Pakistan followed by Egypt, Qatar and Kuwait are the most optimistic about personal financial positions. UAE among the more pessimistic Slightly more than a third of residents of Saudi, UAE and Qatar feel the country s economy has improved. Majority in most countries feel it is a neutral time to purchase consumer durables Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Financial Better Same Worse Don t know Country's Economy Better Same Worse Don t know Consumer Behaviour Good time to buy Neutral time to buy Worse time to buy Don t know

23 Appraisal of Present Situation 2/3 Q. How would you rate the current period in terms of business conditions? Q. Currently, how easy or difficult would you say it is, to find a new job in the country you live in? Qatar and Saudi lead the field on positivity about business conditions followed by UAE, Algeria and Kuwait The job market in Qatar and UAE seem to have the highest supply, the other countries lagging behind Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Business Conditions Good time Neutral time Worse time Don t know Employment Plenty available Not many available Very few available Don t know

24 Appraisal of Present Situation 3/3 Q. How does the current number of employees in your organisation compare with that last year? Q. Compared to the situation of last year, has your salary kept pace with the cost of living? Qatar still seeing boom times in the job sector followed by UAE and Kuwait All countries agreed salaries are not keeping pace with cost of living more so in Lebanon, UAE and Jordan Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Number of Employees More employees Same number Fewer employees Don t know Salary vis-a-vis Cost of Living Increased more than cost of living Increased similar to cost of living Not kept pace with cost of living Don t know

25 Expectations for the Year Hence 1/2 Q. In what way do you think your (and family s) financial position would change in a year s time? Q. In what way do you think your country s economy would change in a year s time? Pakistan, Kuwait, Qatar and Egypt lead the way on future outlook of personal financial position. Qatar, Saudi and UAE are most positive on country s economic position in a year. Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Financial Will be better Will remain the same Become worse Don t know Country's Economy Will be better Will remain the same Become worse Don t know

26 Expectations for the Year Hence 2/2 Q. In what way do you expect business conditions to change in a year s time? Q. In what way do you expect availability of employment to change in a year s time? Qatar, Saudi, Kuwait and UAE feel business conditions will be better next year. Expectations of future availability of jobs are higher in Qatar than in other countries with 61% of respondents believing there will be more jobs available. UAE and KSA follow at 49% and 47% respectively. Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Business Conditions Will be better Will remain the same Become worse Don t know Employment Will be more available Same number Will be fewer available Don t know

27 Satisfaction with Career Q. How would you rate your satisfaction with your current job and career prospects? Q. How would you rate your satisfaction with career growth in your current organisation? Employees in most countries are moderately satisfied with their career prospects In terms of career growth, people in Egypt and Algeria are relatively more satisfied Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Prospects High Neutral Low Don t know Career Growth High Neutral Low Don t know

28 Satisfaction with Career Q. How would you rate your satisfaction with job security in your current organisation? Q. How would you rate your satisfaction with your current compensation (including salary, allowances and other benefits)? Job security is not a big concern for most employees as 67% express moderate to high satisfaction with Algeria relatively more satisfied. On compensation, satisfaction is moderate to low with more UAE residents dissatisfied Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Job Security High Neutral Low Don t know Compensation High Neutral Low Don t know

29 Investment in Vehicle Q. Would you be planning to invest in a vehicle within the next 12 months? Q. Which of the following types of vehicle would it be? Slightly more than a third would be buying a vehicle in the next 12 months. Somewhat more in Jordan, UAE and Qatar Most of those planning to invest in a vehicle would go in for a new one. The inclination towards new cars is higher in Algeria. Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Vehicle Yes No Don t know Base Size Types of Vehicle New Used Don t know

30 Investment in Property Q. Would you be planning to invest in property within the next 12 months? Q. Which of the following types of property would it be? Consumer interest in property investment is slightly lower than 30%. Qatar is the market which generates a higher interest Most of those wishing to purchase a property are likely to go in for a new property. Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Property Yes No Don t know Base Size Types of Property New Lived in Don t know

31 Purchase of Electronic Appliances Q. Can you please tell us which of the following are you planning to invest in the next 6 months? Higher interest for desktop/laptop followed by furniture and digital camera. Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Different Appliances Desktop or Laptop Furniture Digital Camera LCD or Plasma Television Air Conditioner Refrigerator Washing Machine DVD or VCD Recorder or Player Home Theatre System Normal Colour Television Vacuum Cleaner Cooking Range Clothes Dryer Normal or Digital Camcorder Video Recorder or Player None of the above / Don't know

32 Expectations of Growth in Organization Thinking specifically about your organization, are you optimistic or pessimistic about each of the following for the next 3 months? Q. Growth in number of employees Q. Keeping up with staffing requirements Qatar and UAE are more optimistic about growth in the number of employees, a good employment market and opportunities available in the two countries Most countries are neutral regarding organisations keeping up with staffing requirements Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia UAE Other Base Size Number of Employees Optimistic Neutral Pessimistic Don't know Staffing Requirements Optimistic Neutral Pessimistic Don't know

33 Expectations of Market Economy Now thinking a little more generally about the economy in the markets you operate in, what kind of impact do you believe each of the following will have on your business in the short term future? Q. Inflation/Rise in cost of living Q. Cost of real estate (rental or purchase) Inflation seems to be beginning to pinch businesses Rising cost of real estate another factor perceived negatively in most countries, more so by Jordan, UAE and Qatar Total Algeria Egypt Jordan Kuwait Lebanon Pakistan Qatar Saudi Arabia Base Size Inflation/ Rise in Cost of Living Positive Neutral Negative Don't know Doesn t have an impact on our business Cost of Real Estate (Rental or Purchase) Positive Neutral Negative Don't know UAE Other Doesn t have an impact on our business

34 Appendix: Some Key Charts by Different Segments

35 By Country of Residence

36 Appraisal of Personal Financial Situation (Better option) Overall respondents are more optimistic of their future financial position than their current one Those living in Pakistan, Egypt and the GCC countries are relatively more optimistic Base: Total Sample N= 14190

37 Appraisal of Personal Financial Situation (Better option) Expectations are lower than before except in Kuwait Base: Total Sample N= July-12518, Oct = 14190

38 Appraisal of Country s Economy (Better option) Respondents are optimistic that the economy of the country would be better in a year s time. Residents of the GCC economies perceive their country s current economy and also future economy in a better light Base: Total Sample N= 14190

39 Appraisal of Country s Economy (Better option) Base: Total Sample N= July-12518, Oct = 14190

40 Appraisal of Career - (High Satisfaction Option) Respondents are more on the neutral frame with regard to perception of career related aspects. Those living in Algeria and Egypt perceive better prospects & growth in terms of career as compared to residents of other countries. Base: Total Sample N= 14190

41 Appraisal of Career - (High Satisfaction Option) Base: Total Sample N= July-12518, Oct = 14190

42 Appraisal of Career - (High Satisfaction Option) Base: Total Sample N= July-12518, Oct = 14190

43 By Nationality

44 Appraisal of Personal Financial Situation (Better Option) The optimism for change in the personal financial situation is high across all nationalities. Asians are highly optimistic that their personal finance would improve in the coming year. North Africans followed by Asian nationals appear to be relatively more satisfied with their present financial situation. Base: Total Sample N= 14190

45 Appraisal of Personal Financial Situation (Better Option) Base: Total Sample N= July-12518, Oct = 14190

46 Appraisal of Country s Economy (Better Option) Respondents are optimistic that the economy of the country would be better in a year s time. Asians followed by GCC nationals are highly optimistic that the country s economy will be better in the future. A similar pattern is also reflected in the perception of the current scenario. Interestingly, Westerners are the least optimistic in terms of the country s economy as compared to other nationals. Base: Total Sample N= 14190

47 Appraisal of Country s Economy (Better Option) Base: Total Sample N= July-12518, Oct = 14190

48 Appraisal of Career - (High Satisfaction Option) North African nationals perceive the prospects, growth and job security as relatively better than other nationals. Compensation in general is felt to be lower across all nationalities, however Westerners have a higher satisfaction than the others. Base: Total Sample N= 14190

49 Appraisal of Career - (High Satisfaction Option) Base: Total Sample N= July-12518, Oct = 14190

50 By Organisational Sector

51 Appraisal of Personal Financial Situation (Better Option) Relative to other sectors, private sector employees in general are optimistic about current and financial prospects in the coming year. MNC employees perceive relatively better prospects in the current as well as future scenario. Base: Total Sample N= 14190

52 Appraisal of Personal Financial Situation (Better Option) Base: Total Sample N= July-12518, Oct = 14190

53 Appraisal of Country s Economy (Better Option) As was observed for personal finance, people working in the MNC s & large local companies are more optimistic of the current and future change in the country's economy. Base: Total Sample N= 14190

54 Appraisal of Country s Economy (Better Option) Base: Total Sample N= July-12518, Oct = 14190

55 Appraisal of Career - (High Satisfaction Option) Career prospects are viewed by MNC employees relatively highly followed by large local companies. Employees in MNCs and large local companies indicate higher growth prospects relative to others However, job security is perceived to be better by those working in government sector, followed by MNCs. Compensation is rated to be higher by those working in MNCs indicating a slightly higher satisfaction relative to those working in other sectors (though overall it is very low) Base: Total Sample N= 14190

56 Appraisal of Career - (High Satisfaction Option) Base: Total Sample N= July-12518, Oct = 14190

57 By Income

58 Appraisal of Personal Financial Situation (Better Option) Interestingly, current financial position as well as perceptions of future financial prospects are almost linear with regard to income with those earning between USD 3,000 and 5,000 being slightly more optimistic of the future Base: Total Sample N= 14190

59 Appraisal of Personal Financial Situation (Better Option) Base: Total Sample N= July-12518, Oct = 14190

60 Appraisal of Country s Economy (Better Option) Most respondents are optimistic about the country's economic future Hardly any difference among those earning above $1000 Base: Total Sample N= 14190

61 Appraisal of Country s Economy (Better Option) Base: Total Sample N= July-12518, Oct = 14190

62 Appraisal of Career - (High Satisfaction Option) Interestingly, those earning $5000 to $6000 perceive career aspects in a more positive light, as compared to other income groups. Base: Total Sample N= 14190

63 Appraisal of Career - (High Satisfaction Option) Base: Total Sample N= July-12518, Oct = 14190

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